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Explaining to clients how paying the premium is the solution
Explaining to clients how paying the premium is the solution

May 09 2022

Explaining to clients how paying the premium is the solution

An MDRT Past President shares a few of her favorite ideas for explaining to clients the value of insurance.

By Caroline A. Banks, FPFS

Topics covered

My career has been built on simple ideas heard from MDRT Annual Meeting presentations. Let me share a few. 

Paying the premium is not the problem; paying the premium is the solution  

Understanding this helped boost my confidence to stop apologizing when a client’s premium was higher than they thought it should be. The size of the premium compared to the size of the problem is very, very small. It is their problem, and we can solve it. It’s about the life they want, the life they don’t want and the cost of each. 

We have to paint pictures in our clients’ minds because, if they don’t buy the concept, preparing figures is a waste of time. Critical illness coverage gives capital to pay off a mortgage. Disability coverage pays an ongoing income to continue to live in the house. We remind our clients that life is full of surprises, and not all of them are good. We provide the shield to meet the blow that no one sees coming. 

Bigger is not more complicated — it’s just bigger 

Once I appreciated this, I knew working in the business sector was right for me, and I knew to aim higher with the clients I wanted to work with. Sadly, as U.K. figures show, life and critical illness coverage to business owners has been largely ignored. Yet business owners will readily spend company money before their own. 
 
If a business is doing well, they need insurance to protect profits. Not doing well? They need to protect their overdrafts and loans. 

Telling clients they have a missing page in the shareholders’ agreement when it doesn’t include critical illness insurance has been a terrific idea for me — and a savior for many businesses over the years. 

Saying “it’s normal business practice” is a great way to underline our advice. 

Some say financial planning is new, that we haven’t been doing it for years and years. MDRT members who follow the “broad concept” have been talking about it. 

Caroline Banks, of London, England, UK, served as the 2015 MDRT President. She’s a Top of the Table member and is a 32-year MDRT member. This blog post is excerpted from a presentation Banks gave at the 2019 MDRT Annual Meeting.